When properties can be had that are cash flow positive and if they are decent properties, and you can lock in current interest rates long term, within a year or two you are going to be sitting pretty with any real estate you buy now.Now, we have an interesting presentation by Pershing Square hedge fund manager Bill Ackman with his bullish analysis on the housing market. My emphasis is more on Bernanke's money printing but Ackman's analysis is sound. Bottom Line: When a market crashes the way the housing market has, you almost always have fundamentals turn in favor of buyers.
Here's Ackman's power point presentation via Buisness Insider.
Wenzel,
ReplyDeleteYour link is broken (it's a javascript pop-up link), here is the correct link: http://www.businessinsider.com/pershing-square-capital-time-to-buy-into-the-american-dream-2010-12#
I don't know... I find it very hard to believe a house is a good investment. There are simply too many houses out there... they really overbuilt them. I think there are way safer investments than that (take gold for example).
ReplyDeleteI may be wrong here, but wasn't the number of FREE (UNSOLD) houses in U.S. just prior to the collapse around 12 million? I don't have enough time to check it, but this figure was huge...
So whatever you see now on the real estate market, it's not the true picture. Banks have foreclosed way more houses than they've put back on a markets. Perhaps they're trying to re-sell maybe only 20-30% of their foreclosed houses. This is mostly because if they place all their foreclosed houses on the market, the prices will collapse even more. So they're trying to unload them piece by piece.
I'd like to see you writing a full text (filled with details) about the U.S. real estate market... explaining why it's a good investment. I just find it very-very-very-very hard to believe. Sure... prices are likely to go up, but not because there's a great demand for them (rather because of what the helicopter Ben is doing).
Cheers mate!
So, I should sell my $30.72/oz. silver that I bought last year for $13.70/oz. in order to make a down payment on an asset that's still in a price down spiral?
ReplyDeleteHmmm...how would that work?
If the dollar value of my new mortgage goes down severely over the next five years, maybe I could make a case for buying a house. But I'm not too sure that the note holder is going to lie down and let that happen without a fight.